According to Cointelegraph: Canary Capital has become the second firm in just one week to file for a spot XRP exchange-traded fund (ETF), following a similar move by Bitwise. The crypto investment firm submitted its filing to the U.S. Securities and Exchange Commission (SEC) on Oct. 8, signaling growing interest in bringing XRP to traditional financial markets.
According to the filing, Canary Capital’s ETF would allow investors to gain exposure to XRP without needing to hold the asset directly, mitigating potential barriers to entry and the risks involved with acquiring and storing XRP. The fund would track XRP’s market price using the Chicago Mercantile Exchange (CME) CF Ripple index, which serves as a real-time price benchmark.
A Simpler Way to Access XRP
Canary Capital emphasized that their ETF would not rely on derivatives to track the value of XRP, thereby avoiding potential counterparty and credit risks. Instead, the firm aims to offer investors a streamlined way to integrate XRP into their portfolios, whether for strategic or tactical asset allocation, without the complexities of holding and trading the digital asset directly.
The filing did not specify which custodian would hold the XRP for the fund or what ticker the ETF would trade under.
Growing Interest in XRP ETFs
Canary Capital’s filing comes shortly after Bitwise filed for an XRP ETF on Oct. 2, marking heightened interest in creating investment products tied to Ripple’s native token. If either application is approved, it would be the first-ever spot XRP ETF sanctioned by the SEC.
Potential Regulatory Hurdles
Despite the increasing number of XRP-related ETF filings, there are still potential regulatory obstacles. The SEC is currently appealing its lawsuit against Ripple, in which the regulator alleges that XRP is an unregistered security. The lawsuit, which involves claims that Ripple raised $1.3 billion through its XRP offering, remains a significant barrier to the approval of these ETFs.
As of today, XRP is trading at $0.53, up 0.4% on the day but trading flat for the week. If approved, the Canary Capital or Bitwise ETF could become a major milestone for XRP, providing mainstream investors with a new way to gain exposure to the digital asset.
